| either fixed or variable. | b. | direct or indirect. | c. | product or period. | d. | standard or actual. | ANS: A PTS: 1 DIF: Easy OBJ: 9-1 NAT: AACSB: Reflective Thinking LOC: AICPA Functional Competencies: Decision Modeling 2. With respect to fixed costs‚ CVP analysis assumes total fixed costs a. | per unit remain constant as volume changes. | b. | remain constant from one period to the next. | c. | vary directly with volume. | d. | remain constant
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Assignment #1: Caribbean Intern Café Date: November 14‚ 2012 1. There are many issues that Mr. Grant should consider before proceeding with the CIC. There are several things that Mr. Grant should examine before even looking at the projections given to him. Total capital is $2‚250‚000‚ $1‚000‚000 in investments and $1‚250‚000 in the form of a long-term loan. $1‚573‚000 is immediately spent leaving $677‚000. If he has no customers‚ he can afford to remain open for 3 months. As well‚ they
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type of organization and this clothing manufacturing company is concerned because they do not have this understanding and what benefits it has for guiding managers to understand the changes and effects different future business decisions and alteration of those decisions have on the expenses and profit but. Although there are benefits to finding and fully understanding these relations there might be problems on the way which will be discussed further on. After reaching an understanding about the
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express) a). Variable cost per passenger=$70.00 Full fare per passenger=$160.00 Contribution margin = $ 160- $ 70 = $ 90 per passenger Contribution margin ratio = $ 90/$160 = 56.25% Break-even point in passengers = Fixed costs/Contribution Margin = $ 3‚150‚000/$ 90 per passenger = 35‚000 passengers Break-even point in dollars = Fixed Costs/Contribution Margin Ratio= $ 3‚150‚000/0.5625 = $ 5‚600‚000. b). Average load factor=70% of 90
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COLLEGE OF BUSINESS BKAL 3063 INTEGRATED CASE STUDY FIRST SEMESTER 2013/2014 (A131) LECTURE: Pn. NORAZA BT MAT UDIN CASE 6: GEZ Petrol Station: Using CVP Analysis for Planning EXPIRE: 24 November 2013 (Before 10 a.m.) GROUP A (7) NAME MATRIC NO MARISA BT MUSRIL GOH ING MIN ELIZABETH ESTONIA ANAK JONIC 195468 205438 207727 NURLIYANA BT ZAINUL ABIDIN WONG ZI XIN 207788 207877 Contents 1.0 Introduction Mr Aiman is the GEZ Bhd’s area manager who is responsible to directing sales activities
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AC552 Midterm Study Guide Studying the following items will assist you in the preparation of your Midterm. You are strongly urged to examine these areas….have fun! * Relevant range * Break-even point * Contribution margin * Process costing * Job costing * Calculate equivalent units * ABC systems * Direct‚ indirect‚ variable‚ fixed‚ prime‚ and conversion costs * CVP analysis Good luck! This is the REAL exam‚ so choose your time to enter carefully. The
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because sales line has higher slope for B so it has more sales amount. b) Fixed Costs / Unit Contribution Margin = Breakeven Point in Units Hence‚ Provider B has higher contribution margin which equals to fixed costs divided by breakeven point in units. So for provider B‚ fixed cost is higher than A; and also breakeven point has less units than A. Consequently‚ Provider B has greater contribution margin. c) Break-even point determines the situation in which company makes neither loss nor profit
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Pre-Text *All numbers are based in Jamaican currency. * All numbers are rounded to the nearest dollar. 1.What managerial issues should David consider before starting the CIC? Before starting the CIC David should consider the following managerial issues: 1. He has minimal training in business ownership. He has the background of a computer programmer‚ and is getting his MBA but he is still in the process of learning and doesn’t have the knowledge to start an internet café. 2. David
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optimize its profit under various situations. Since profit results from the exceeds amount of sales income compare to the costs‚ therefore understanding the changes in sales volume‚ selling price and cost are very important to facilitate in making right decision. OBJECTIVES Referring to the scenarios given below‚ this study helps to achieve the following objectives: 1. To understand the relationship between sales components and costs that will affect the Hospital Supply‚ Inc.’s profit. 2.
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affect a company’s profit. CVP is a powerful tool for planning and decision making. Operating Income = Total revenue – Total Expense Contribution margin is the difference between sales and variable expense. It is the amount of sales revenue left over after all the variable expenses are covered that can be used to contribute to fixed expense and operating income. Contribution Margin = Price – Variable cost per unit Contribution Margin Ratio = Break-even point in number of units and in total sales
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